California Apparel News

A man under investigation for nearly four years pleaded guilty in Los Angeles Superior Court to selling thousands of counterfeit designer bags in the Fashion District of downtown Los Angeles.

Gad Azouley, 37, of North Hollywood, Calif., pleaded guilty on Feb. 1 to one count of counterfeiting and one count of tax fraud before Superior Court Judge Sam Ohta.

Azouley, who will be sentenced on April 24, faces two years in state prison, authorities said. He also must pay between $50,000 and $70,000 in restitution to the handbag manufacturers and $27,000 to the state Franchise Tax Board.

“I hope this sends a message to those that import or sell counterfeit handbags that the crimes are not victimless and that local and federal law enforcement take them very seriously,” Deputy District Attorney David Berton said.

The investigation began in May 2002 when U.S. Customs and Border Protection employees at the Port of Los Angeles detained two containers packed with more than 12,000 fake designer handbags, including Gucci and Louis Vuitton knockoffs. The items came from Guangdong Province in southern China.

Government officials said Azouley was selling the handbags out of a showroom called Inbal Collection at 830 S. Hill St. A warehouse storing the goods was located at 860 S. Los Angeles St., said Kevin Kozak, acting special agent in charge of investigations in Los Angeles for U.S. Immigration and Customs Enforcement, which worked on the case.

“There was significant evidence of previous large-scale shipments from documents seized. There were thousands of handbags [at the warehouse] that were not part of the containers,” Kozak said, who declined to say whether Azouley was acting alone.

Most of the bags had Gucci and Louis Vuitton labels, but there were also some Burberry-tagged bags. “These were not the top-of-the-line merchandise we have seen coming in in the last couple of years, which is harder to detect,” Kozak said. “This was more mid-range quality.” —Deborah Belgum